UPDATE: Goldman Sachs Reiterates Neutral Rating, Lowers PT on Envivio

In a report published Friday, Goldman Sachs Group reiterated its Neutral rating on Envivio

, but lowered its price target from $5.00 to $3.00. Goldman Sachs noted, “Envivio attributed its disappointing outlook to continued caution on the macro and lack of visibility into the timing of customer deployments. However, the company maintained that its competitive position is intact and pricing is largely unchanged, citing 85 new multi-screen wins and 17 new customers in the quarter, compared to Harmonic's 25 multi-screen wins. While we still believe in the long-term secular growth trajectory of multi-screen video, we think the near-term slowdown in adoption may be a function of several factors, including: (1) digestion of previously shipped products by Envivio, (2) potential customers' consideration of alternative architectures, such as transcoding in the set-top box as opposed to in the network, (3) more aggressive pricing by competitors, and (4) content licensing challenges, which were accentuated during the quarter by the very public Viacom-Direct TV dispute. Envivio laid off 9 employees (out of a 160 headcount) to limit losses. We maintain our Neutral rating, with the stock trading near the $63mn cash level ($2.35 per share). We estimate a cash burn of $13mn over the next 4 quarters.” Envivio closed on Thursday at $2.68.